If you receive rental income in Kenya, you're required to pay Monthly Residential Rental Income (MRI) Tax. Many landlords don't know this requirement exists — but KRA does, and enforcement has increased significantly.
Who Pays MRI Tax?
Any person receiving residential rental income from property in Kenya, where annual rental income falls between KES 288,000 and KES 15,000,000.
- Below KES 288,000/year (KES 24,000/month) — no MRI tax due. You are exempt. A NIL return may still be required.
- KES 288,001 – KES 15,000,000/year — MRI applies at 7.5% of gross income
- Above KES 15,000,000/year — MRI does not apply. You use the normal income tax bands (10%–35% progressive rates) and may claim deductible expenses
The MRI Tax Rate
The rate is 7.5% of your gross rental income — no deductions are allowed under the MRI system. You cannot deduct mortgage interest, property maintenance, or management fees when calculating MRI tax. The tax is on total rent received, not profit.
Example: You earn KES 50,000/month rent from a flat (KES 600,000/year). Your MRI tax = 7.5% × KES 600,000 = KES 45,000/year (KES 3,750/month).
When to Pay
MRI tax is due by the 20th of every month, paid via iTax for the previous month's rental income. Payment is via M-Pesa or bank transfer through the KRA payment system.
Commercial Rent is Different
Commercial property rental (offices, shops, warehouses) is subject to 16% VAT if the landlord is VAT-registered. Commercial landlords must issue eTIMS VAT invoices to business tenants. The MRI simplified system applies only to residential properties.
eTIMS and Residential Landlords
Residential rent is VAT-exempt — you do not charge tenants VAT on rent. However, you may still need to issue eTIMS income receipts for your rental income. From 2026, all income declared on your tax return should be backed by eTIMS records.
Managing with KompliTax
KompliTax Landlord Mode manages your properties, tracks rent payments, generates eTIMS receipts automatically, and calculates your MRI tax liability each month. It also sends reminders before the 20th so you never miss a payment.